Navigation

Eurozone pours cold water on pension cut talk

The eurozone tried on Friday to contain Greek government rhetoric on suspending upcoming pension cuts, saying that any discussions on that matter are premature, and sending a clear message that Athens should not reverse reforms, particularly in the field of labor.

Responding to strong rumors in recent days that the measure’s suspension would be discussed at next Thursday’s Eurogroup meeting, a senior eurozone official stressed this is not true. The issue will only be raised once the representatives of the country’s creditors return to Athens later in September for the first post-program inspection.

“Any such discussion is premature,” the eurozone official stated, adding that there is an agreement for a primary surplus of 3.5 percent of gross domestic product that may not require the pension cuts now but “I do not know whether they will be needed when the economic cycle changes.”

The same official also informed reporters in Brussels about how the first inspection after the end of the bailout program will be carried out, stressing that it will be very different to those of the previous eight years and to the quarterly visits to other countries that emerged from similar programs.